Class 12 SP Letter for Payment of Deposit Interest Electronically (ECS/NEFT)
Master the official format and scoring guidelines for the Class 12 Secretarial Practice (SP) letter on the Payment of Interest on Public Deposit (Electronically via ECS / NEFT) tailored for the Maharashtra State Board (HSC) Commerce examination. Under Chapter 8 (Correspondence with Depositors), drafting an intimation letter regarding the direct electronic bank credit of interest to a depositor is a highly modern and frequently tested question in Question 7 (Letter Writing), carrying a direct weightage of 5 marks. Below, you will find the official board exam scenario, step-wise marking breakdown, statutory tax rules, and a textbook-accurate solved model answer.
Statutory Rule & Secretarial Precaution: Companies are increasingly shifting to the Electronic Clearing Service (ECS) or NEFT/RTGS for bulk interest payments. This method ensures that the net interest (after deducting Tax Deducted at Source - TDS under Section 194A of the Income Tax Act) is credited instantly to the depositor's registered bank account on the exact due date, completely eliminating the risks of postal delays or fraudulent encashment of physical warrants.
HSC Board Examination Question Scenario
In the HSC examination, this question is typically framed as follows:
"Draft a letter to a depositor informing him / her regarding the payment of interest on their fixed deposit electronically through ECS / NEFT."
Official HSC Step-Wise Marking Breakdown (5 Marks)
Examiners evaluate secretarial correspondence based on structural completeness and accurate electronic banking references:
| Component | Required Exam Content | Marks |
|---|---|---|
| Letterhead & Layout | Company Name, Registered Address, 21-digit CIN, Phone, Email, Website, Ref. No., and Date. | 1 Mark |
| Inside Address & Subject | Depositor's Name, Address, concise Subject Line, and formal Salutation. | 1 Mark |
| Body of the Letter | Reference to ECS mandate, calculation schedule table (with TDS column), and UTR/Bank transfer details. | 2 Marks |
| Sign-off & Subscription | Complimentary close ("Yours faithfully"), Secretary signature block. (No Enclosure). | 1 Mark |
| Total Marks | Question 7 (Attempt Any 2 Letters out of 3 = 10 Marks Total) | 5 Marks |
Solved Model Answer: Payment of Interest on Deposit (Electronic Mode)
HORIZON TEXTILES LIMITED
Registered Office: 55, Textile Park, Bhiwandi, Thane - 421302.
CIN: L17120MH2012PLC456789
Phone: 02522 - 277889
Email: deposits@horizontextiles.com
Website: www.horizontextiles.com
Ref. No.: HTL/DEP-INT/E-24/2026-27
Date: 12th January 2027
To,
Mr. Vikas R. Rane,
Block A-14, Gokuldham Society, Film City Road,
Goregaon (East), Mumbai - 400063.
Subject: Payment of Interest on Fixed Deposit via ECS / NEFT.
Dear Sir,
I am instructed by the Board of Directors to convey to you that the interest on your Fixed Deposit with our company has become due for payment for the financial year ending 31st March 2026.
We are pleased to inform you that in accordance with the electronic clearing mandate registered by you with the company, the net interest amount due to you has been directly remitted to your designated bank account. The detailed calculation of the interest payout is summarized in the schedule below:
| FDR No. | Deposit Amount (₹) | Rate of Interest | Gross Interest Amount (₹) | TDS @ 10% (₹) | Net Interest Paid (₹) |
|---|---|---|---|---|---|
| 3522 | 1,00,000/- | 9.0% p.a. | 9,000.00 | 900.00 | 8,100.00 |
(Note: Tax Deducted at Source (TDS) has been deducted as the gross interest amount exceeds the statutory exemption limit.)
The net interest amount of ₹ 8,100/- has been successfully credited to your bank account as per the following transaction details:
- Bank Name: HDFC Bank
- Branch: Goregaon (East) Branch, Mumbai
- Bank Account Number: *******4455
- Transaction Reference (UTR) No.: NEFT/HDFC/270112/556677
- Date of Credit: 12th January 2027
Kindly verify the credit entry in your bank passbook or account statement. We assure you of our prompt professional services at all times.
Thanking you.
Yours faithfully,
For Horizon Textiles Limited
(Signature)
Ms. Priya Kadam
Company Secretary
Examiner's Secret: 3 Critical Points for Scoring Full Marks
- Zero Enclosures: Because the payment is entirely electronic (NEFT/ECS), no physical warrant is attached. Writing an
Encl:line by mistake in this letter is a major factual error that will cost you marks!- Include Electronic Evidence: Always list the Bank Name, Account Number (masked for privacy), and a fictional UTR (Unique Transaction Reference) Number in bullet points below the table to make the electronic format look authentic.
- The TDS Logic: Remember to calculate TDS (usually 10%) on the gross interest and explicitly subtract it to arrive at the Net Interest Paid. Show this clearly in the table columns.
Frequently Asked Questions (HSC Board Exam FAQs)
1. What are the advantages of paying deposit interest via ECS/NEFT?
Electronic clearing eliminates postal transit delays, completely avoids the risk of lost or stolen warrants, saves printing and administrative costs for the company, and ensures immediate, direct credit to the depositor's bank account.
2. Does the company need shareholder approval at the AGM to pay interest on deposits?
No. Interest on public deposits is a fixed charge against company profits, not an appropriation of profits (like dividends). It is paid based on the prior approval of the Board of Directors, without needing shareholder approval at an AGM.
3. What does UTR stand for in electronic banking?
UTR stands for Unique Transaction Reference. It is an alphanumeric code generated by the banking system to uniquely identify any NEFT or RTGS transaction, serving as legal proof of the fund transfer.